Telangana Budget: Congress govt eyes Rs 3.25 lakh crore outlay for 2026-27

The Congress government in Telangana is preparing a bigger Budget for 2026-27 with an outlay of up to Rs. 3.25 lakh crore, even as the current year sees spending shortfalls, revenue gaps and rising dependence on borrowings.

Hyderabad: Even before it has managed to spend what it promised this year, the Congress government in Telangana is drawing up an even bigger State Budget for 2026-27, with the outlay expected to range between Rs. 3.20 lakh crore and Rs. 3.25 lakh crore. Formal preparations are already under way, with the Budget likely to be presented in the second week of February.

The ambition contrasts sharply with recent fiscal reality. The 2024-25 Budget was pegged at Rs. 2.91 lakh crore but later trimmed to about Rs. 2.65 lakh crore. The current financial year’s Rs. 3.04 lakh crore outlay is also set for a downward revision, reportedly to around Rs. 2.73 lakh crore, which is nearly Rs. 31,000 crore below the original estimate.

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Finance department sources attributed the cuts to revenue collections falling short of projections despite modest growth in tax receipts and higher Central transfers. While such revisions are routine, officials privately admitted that mounting debt this year has become a serious concern.

By December-end, spending stood at about Rs. 1.77 lakh crore, which is less than 60 percent of the Budget estimate of Rs. 3.04 lakh crore, leaving a heavy last-quarter push that may prove difficult. Revenue trends offer little comfort. Around 65 percent of annual tax targets had been realised by December, while non-tax revenues lagged sharply at just over 22.5 percent.

Despite this, the government is betting on improving revenues from property registrations, GST, excise, mining and land sales to justify a jumbo Budget next year. At the same time, officials are expecting continued reliance on market borrowings and Central funds to bridge gaps. This year, borrowings overshot Budget Estimates by 122 percent, while Central grants formed a meagre 16 percent of the Budget estimates.

Pre-Budget consultations, chaired by Deputy Chief Minister and Finance Minister Mallu Bhatti Vikramarka, are being held department-wise until February 5. Ministers and senior officials are presenting fund demands, utilisation details and proposals for new schemes, as the finance and planning wings are reviewing performance and pending Central releases.

The exercise is being billed as fiscal discipline. But the numbers suggest that the government is chasing big-Budget optics while grappling with execution gaps. If the current year is any indication, the next Budget could turn out to be another glossy announcement with impressive size but thinner delivery.